North korea wants to test the Hydrogen Bomb over the Pacific Ocean. That should go well. Defense stocks, lockheed, northrop grumman, jumping on the idea this is a get a little wacky. Former cia analyst tara lackey, if he goes ahead to do a launch or nuclear test over the Pacific Ocean, he would have to give the world a head as up, that in region test is going on, knock out electronics. For planes could be very dangerous, they could fall from the sky. They have to be cognizant of that. Where do you think this is boeing . This situation is getting very somely indicated. It is escalating, north korea ratcheting up provocative behavior out of north korea yesterday. Sanctions were put in place by the u. N. China instructing banks not to do as much business with north korea. The Trump Administration issuing a executive order yesterday giving a lot more flexibility and latitude in terms of imposing sanctions on north korea. And countries doing any potential business, Financial Transactions were north korea. You have escalating pressure on one hand. But you dont necessarily see that, returning to north korea and provocation. What happens you need to ramp up pressure, the Trump Administration is doing a good job. You need a timetable of some sort of a work towards a diplomatic effort. Throughout history, sanctions alone dont tend to change behavior. There needs to be coinciding diplomatic channels to get some sort of a positive diplomatic outcome here. We dont want neil good luck with that, right . The very fact that china announce this is move in an agreement with donald trump, to have its central bank forbid all chinese banks from doing business with north korea, then, kim jongun comes out with this idea of an above ocean test, a Hydrogen Test sometime in the near future. So, that seems as in your face to us, as it does the chinese, as it does to the rest of the world. Where is this going . It is and i dont think there is provocations going on both sides here. I think we need to temper the language a bit. People dismiss the twitter wars. Language is important but accidental escalation can occur, not in just in terms after nestle crisis. We dont want missiles launched to territories like guam. Neil what did he does the Hydrogen Test . Furthermore announces when he is doing it, brings up issue where planes in the region could call from the sky, then what . That would be a provocation. That im sure in the eyes of some would be deemed an act of war, would it . It would be an extreme escation laugh the situation as any missiles launched towards a u. S. Territory. To be honest i thought he would do a provocation like that. Seems he took it another direction with this hydrogen threat test, very concerning and very serious. What you will need to see happen here, you will need to see the chinese, the south koreans, japanese trying to pressure North Koreans financially with trying again, you need to get parties to the table. Even if that means a shortterm agreement, like a ceasefire, conflicts like syria. You do a short ceasefire. It will not last or be perfect but ratchet it down temporarily to create windows of opportunity to happen. It will not be an agreement to be longstanding. You really need that is what diplomacy and u. N. Is for. The Security Council there to impose sanctions and get it solutions. Im in full agreement what the Trump Administration is doing on sanctions front has been 100 correct. What im saying were missing a plan or i havent seen one, what are the options there . That doesnt mean concessions. It means options for shorter term negotiations strategies to ratchet down tensions in the short term to buy some time. So prevent potential hydroagain test in the pacific. Neil anything like that. Sara, thank you. Thanks. Neil tara malar, former cia analyst. Fallout, asian markets mostly lower on the latest threat of north korea. A lot is riding on china, whether china can make good in its promise, to prohibit all banking relationshipses with north korea. We have a harry smith and we have riley waters. Riley, your take on this, whether the chinese can rein him in . I find it interesting the part of kim jongun for the test somewhere in the near future comes despite maybe because of the chinese, you know, tightening the financial spigot. What do you think of that . So china has a reputation of sort of doing the minimal necessary requirements, especially regarding sanctions. Regarding the statements that have been coming about about the peoples bank of china, telling its banks not to do business with korea i think it is a step in the right direction. It will come down of course monitoring whether these tanks take that neil how can we monitor that, by the way . Because it seems kind of tricky. How do you monitor that . There is no easy way of course to honor these companies. It will be through both treasury department, through, our friend and allies overseas as well as they monitor what china is doing and what north korea is doing. But, i think one way to sort of you know, keep china line, through the executive order signed yesterday imposing additional sanctions on entities that do business with north korea. Neil i think everything changed with this, you know, promise, threat, whatever you want to call it on part of the North Koreans to test the weapon over the Pacific Ocean. It would be the first atmospheric test since what, october 1980. Going back to china at the time. Those are scary. I remember that pretty well, to show you how old i am. That scared the entire world. Anything could go wrong. We were worried about planes going down and low orbiting satellites and the rest. The reason this is not commonly done. China learned that after that, but north korea, what do you think . I dont know. It is certainly highly provocative especially considering the idea of an active Hydrogen Bomb flying over the Northern Territory of japan itself is completely escalatory. The sanctions that have been put in place in the short term and long term, were always part of the longgame process. Arguably the u. S. And u. N. And our allies have rarely done enough in the future. The more recent sanctions are a step in the right direction. The question is, i think what youre alluding to is, is it too little too late . Neil all right. When we look at this, i do want to go to you here, is it your sense this is going to escalate now . Well, i think were realizing that north korea is a violent, communist dictatorship, and it has been that way since the soviet union established it in 1948, and what china has done, i dont think they have seen the light. It has been result of the United States pressuring them. We need to ask the question, why china has been supporting north korea diplomatically, trading with them, hosting some 40,000 slave laborers from north korea on chinese territory. Cooperating with neil you have your doubts about how cooperative china will be, right . I do. I do. Neil so let me ask you this then. Would it be provocative act, act of war in your view, if they were to do this atmosphere test, especially unannounced or without warning . Im sorry you have to repeat the question. Cant hear you. Neil if they go through with this test to do a Hydrogen Explosion test over the Pacific Ocean, and they dont warn people about it, they dont do it, is that a provocative act . Is that an act of war . Well, absolutely. North korea has been on a war footing with the United States since the ceasefire end of the korean war. What do we do in response if they go ahead and do that . Well that is for u. S. Policymakers to decide. President trump will have to make that very difficult decision. It is going to be more difficult now to contain north korea and achieve a free government there than it would have been 10 years ago. And that is partly because the Chinese Government has supported north koreas regime. Neil all right. So riley, the question then becomes, how much further pressure china could exert, and this is just my opinion, looks like china can, or they have a rogue frankenstein on their hands because of timing of this threat, even after the chinese announced they will freeze all funding through their Financial Institutions, then we have got even bigger worries, right . Right. So china can impose much more action. It all comes down to, how much theyre actually willing to invest in monitoring these cost cost. At same time theyre trying to balance a stable relationship with the United States itself. So we have a couple of big events coming up. Both the 19party congress where leadership might change, not the top level of course, but at lower levels for china to measure in ways these National Security concerns but you have also got the trump visit, trumps visit to asia and china this november. Again measuring the balance of u. S. China relations in that context. Of course north korea will be a major talking point at both of these instances. Neil gentlemen, i want to thank you both. Things are moving fast and furious here. One last peek if we can, guys at the defense and related stocks. They are the group up smartly. Since a lot of sabrerattling, you can pick a time period but theyre up double digits since that time. Were going back more than a month when they were doubling up and number of tests and Missile Launch muchs and the like. The latest agitation many are up on the combos and like but not for asia. It is happening in their neck of the woods and theyre getting rightly nervous. Well have more after this. Parodontax, the toothpaste that helps prevent bleeding gums. If you spit blood when you brush or floss you may have gum problems and could be on the journey to much worse. Help stop the journey of gum disease. Try parodontax toothpaste. Im living that yacht life, life, life top speed fifty knots life on the caribbean seas its a champagne and models potpourri on my yacht made of cuban mahogany, gany, gany, gany watch this dont get mad bell mnemonic get e trade and get invested with its hightech the cameras and radar,c. Contemporary cockpit, three hundred and sixty Degree Network of driverassist technologies, and sporty performance. Whats most impressive about the glc . 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Liberty mutual insurance. Neil a week ago it didnt look like it would happen now it is on. Controversy notwithstanding, talking about the cats did cassidygraham Health Care Repeal. Blake burman in washington how passage is looking or not looking. What are you hearing, blake . Reporter as of now they appear a couple votes shy. They need to get the 50vote level. Mark short, head of legislative afairs, the 4 to watch, rand paul is no, john mccain, lease murkowski, and Susan Collins if those defect, this thing would be killed. There are two very specific words that are defining this debate and that is affordable and accurate. Here is why. Grahamcassidy allows a waiver to rid themselves of the Obamacare Mandate that preexisting conditions need to be covered. However the language of this bill also states if the states end up seeking that waiver, they need, and im quoting here, they say the state need to show how and it intend to maintain access to adequate and Affordable HealthInsurance Coverage for individuals with preexisting conditions if such waiver is approved. That is the language of the bill. On one hand, some sponsors say it is in there. You have got protections, no need to worry. However, those who are against this, mainly democrats, a lot of Industry Groups say that is way too ambiguous. It leads to a slippery slope. It brings us back to the days when Insurance Companies could discriminate against people with preexisting conditions. The ban on discriminating against people with preexisting conditions would be gone. Nobody can be denied coverage because of a preexisting illness. Nobody can be kicked out of insurance and the cost has to be affordable and credible. Reporter mccain is a no. Murkowski, collins, who am i missing here, a third. Im sorry paul is a no. Murkowski, mccain and collins remains to be seen which way they will go. Because of that, neil, it remains to be seen whether this thing will be brought up to the floor next week. Mcconnell said it is his intention to. Right now they do not have the 50vote threshold at least not yet, neil. Neil youre at the white house where the president tweeted yesterday, if grahamcassidy did not include coverage for preexisting conditions he wouldnt sign it. Sound it me like preexisting conditions are going to be covered but there doesnt appear to be a guarranty those with such conditions would pay more, right . Reporter that goes to the part in the bill, it needs to be affordable and adequate. Which goes to the question, what is affordable . Neil what is affordable. Youre not going to pay as low a rate or premium as they are but you are going to pay more, right . Reporter right. I mean it will be affordable they say, but then again you know, what is that . Neil its weird. Thank you, buddy, very, very much. Meantime, in the middle of all of this, the house ways and means boss, kevin brady, talking to me about the tax cut thing he wants to see pushed through and fast. Signs that the wealthy may not be getting a tax cut. He reacted to that. Were determined to deliver the lowest rates on local businesses in modern history. Neil if the rates ultimately come out of the white house, chairman, are not across the board, in other words everyone gets their taxes cut, would you be disappointed . I would. So heres why. It is incredibly important i think, we close loopholes, eliminate special provisions and lower tax rates on every american. Neil all right. That is significant departure from the white house here. You have the house ways and means chief, first guy putting this together, saying that if the white house follows through with a plan to leave the rich out of it, he would be disappointed. He wants across the board cut of consequential cuts in American History go back to jfk, ronald reagan, to george w. Bushs tax cuts in the early 2000s. If you dont follow through on that, you will get limited impact from that. Is that the case . Lets ask north Dakota Republican senator john hoeven. Senator, very good to have you. I know you have a crazy schedule today. What do you make of that . Could you support a tax measure that wouldnt include the wealthy, in other words, wouldnt be across the board . Neil, i think it would be focused on middle class and wage earners. The reality i think it will be across the board, we want to make it progrowth. We want the economy to create more jobs, look at subs corps, Small Businesses in this country, were talking about lowering rates to create more jobs an opportunity. That drivers wages up. That helps wage earner along with the tax cut were trying to do. I think you will see it will be across the board. Neil you cited them, because they pay whatever the prevailing rates are, not the corporate rate, but a lot of Small Businesses scorps and marginal rates. You have your ccorps, your scorps you bring the Business Rates down, if you have a big disparity between that and top rate that creates a problem as far as difference between big business which are typically ccorps or passthroughs or scorp. S the case for Small Businesses. Neil would you support a measure out of the white house, next wednesday, senator, that details didnt include at . I have to look at it, neil. Neil yeah. The reality you will see the kind of reductions i described. I think that is what well see. Neil all right. I will look at anything the white house brings forward. We need to do tax relief and tax reform and we need it done and im committed to doing it. Neil well go back to the Health Care Repeal well, again, as you know, senator. Im wondering where are you on this cassidygraham measure . Would you be for it what you have learned thus far . Yes. I support it. It is about getting resources out to the states, and letting them design programs working with their Health Care Companies and Health Care Providers that work. It just comes down to your philosophy. I trust the governor and the legislature of our state and other states to do a better job than the federal government. Neil you know, a lot of your colleagues, well, not a lot i should stress here, rand paul is only one out there on the record saying woe oppose this but their big concern is this isnt much better than whats out there right now, and there are five other republicans wh